De-Risking the Ecosystem for Banking and Insurance Clients with IBM Cloud for Financial Services

4 min read

Why have the majority of financial services industry workloads not moved to the cloud?

Financial services clients worldwide have a strong desire to leverage public cloud for agility and innovation, accelerate their digital transformation and grow their market share and revenue. Unfortunately, only 16% of the regulated workloads have moved to the cloud [1]. They cannot get private-cloud-like transparency to address their security and compliance needs for auditors and regulators.

Simultaneously, there is an extensive ecosystem of Independent Software Vendors (ISVs), SaaS providers and fintechs wishing to do business with banks to accelerate their journey to the cloud, help innovate and bring new products to the market at speed. These ecosystem partners must adhere to the financial institutions’ requirements and governance, risk and compliance controls, creating high complexity and expense while delaying revenue. Overseeing unique risk and compliance certifications for each financial institution — often lasting 12 - 18 months — quickly becomes unmanageable, detracts from core competencies and slows innovation.

What is needed to address this problem?

There is no industry-standard controls framework for financial services. As the financial institutions are ultimately responsible for the risk of hosting regulated workloads in the cloud or doing business with ISVs and SaaS providers, the financial institutions pass on the control definitions to their Cloud Service Providers (CSPs), ISVs and SaaS providers. Managing these risks introduces complexity and expense across the ecosystem. CSPs, ISVs and SaaS providers must meet financial institutions’ varying requirements.

There is a clear need for a standard and automated industry approach to managing security and regulatory requirements, reducing risk and enabling institutions and their partner ecosystem to adopt public cloud to innovate faster and unlock new revenue opportunities.

Accelerating innovation and de-risking the journey to cloud is at the heart of IBM Cloud for Financial Services™. Digital supply chain partners can begin to transact faster when compliant with the industry-informed control framework and demonstrate compliance continuously using automated tools.

How does IBM Cloud for Financial Services help reduce risks and costs?

We designed IBM Cloud for Financial Services, an industry-first cloud, to deliver the benefits of the public cloud while meeting stringent industry requirements for security, resiliency and compliance. Central to the platform is the IBM Cloud Framework for Financial Services that provides industry-informed, risk-centric security and compliance controls required to operate securely with bank-sensitive data in a public cloud.

The IBM Cloud Framework for Financial Services is adhered to by the entire IBM Cloud for Financial Services digital supply chain and was developed with several global top banks and Promontory, a global leader in financial services regulatory compliance consulting. The IBM Financial Services Cloud Council maintains the IBM Cloud Framework for Financial Services, made up of CSOs, CTOs and CIOs from major banks and regulatory advisors worldwide. The IBM Cloud Framework for Financial Services provides industry-informed controls, automated continuous compliance and implementation and evidence-based operations that the financial services company can use to enable risk management and security protection. In short, the IBM Cloud Framework for Financial Services controls bring consistency across financial institutions and their ecosystems.

How does IBM Cloud for Financial Services benefit ecosystem partners?

The IBM Cloud for Financial Services Partner Ecosystem is designed to de-risk those partners on IBM Cloud for Financial Services. This reduction in risk helps accelerate innovation for the financial institutions and unlocks new revenue opportunities for both client and partner while reducing compliance costs. The partner benefits include the following:

  • Increased brand visibility, with expanded access to financial institutions, technical and sales resources, joint marketing opportunities and a place in the IBM Cloud catalog
  • Expedited time-to-market and time-to-revenue by meeting banks’ compliance and audit requirements faster
  • Reduced cost and time to compliance, greater mutual trust with banks and access, security by design and validating adherence to pre-defined financial services security and controls
  • Increased time to focus on app innovation and engineering with access to a trusted cloud ecosystem and end-to-end services

What does our partnering approach bring to your ecosystem?

As confirmed by analysts, there’s a significant financial market opportunity with spend for cloud and public cloud. IBM Cloud has a program focused on reducing the inherent security and compliance risks of cloud technology and operations, and these benefits extend into our partner ecosystem. The common operational criteria and streamlined compliance controls help ISVs more effectively demonstrate security and compliance. IBM works closely with ISVs to conduct a rigorous architecture and security validation process to conform to these controls.

Our partnering approach has three primary dimensions: technology support, go-to-market collaboration and the Cloud Engagement Fund. We intend for each dimension to help our ISV, SaaS and Global System Integrator partners participate in the program with us.

Technology support

There’s a technical dimension to what we do that aims to ensure the partner adopts and inherits the intrinsic security and resiliency in three ways:

  • Aligning to one of the three secure reference architectures
  • Providing implementation and evidence guidance to deploy the software and improve the security posture
  • De-risking the digital supply chain partner and preparing it to do business with any financial services client across the globe

Go-to-market collaboration

We promote a partner’s offering on the go-to-market side, including validation and a designation by IBM Cloud. We extend the IBM PartnerWorld® competency designation, which potentially opens up our partners to tens of thousands of IBM clients. We co-create go-to-market and joint sales plays with our partners, too.

Cloud Engagement Fund

The Cloud Engagement Fund is the vehicle IBM uses to create momentum on the technology and go-to-market sides. We use the Cloud Engagement Fund to develop services and facilitate the move to IBM Cloud. Benefits can include a range of credits for IBM Cloud services, other environments or pre-sale environments. This benefit allows IBM and partners to develop use cases jointly and gives you a way to learn how to use IBM Cloud services in the IBM Cloud for Financial Services context.

Learn more

Ask your IBM Partner Representative for more information about the ecosystem program resources supporting IBM Cloud for Financial Services and the Partner Ecosystem.

 

[1] CIO Surveys, Equity Analyst Research 2019-20.

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